US Food Aid Groups Debate Practice of Monetization

The U.S.-based charity CARE recently made headlines for turning down some $45 million in U.S. government food aid. The decision to refuse the aid is tied to the group's opposition to the practice of selling U.S. government-subsidized foodstuffs for cash to support food aid programs. From Washington, VOA's Margaret Besheer has more.

The United States is the largest food aid donor in the world, contributing more than $1 billion annually. That aid helps millions of people around the world in emergency situations, such as wars and natural disasters, as well as funding development programs for the eradication of malnutrition and hunger.

But procuring, shipping, storing and distributing more than 2.5 million metric tons of aid each year is complex and costly. In the mid-1980s, U.S. legislation introduced the practice of selling some of the American-grown food in recipient countries to generate cash to support the costs associated with providing food aid, a practice called monetization.

Doctor Helene Gayle, the president of the U.S.-based charity CARE, says monetization is harmful to local farmers and economies, because it floods local markets with cheap imported crops, which local farmers cannot compete with.

"Our feeling was this is just a practice that is inconsistent with our overall goal of reducing chronic hunger and of reducing poverty, and we felt it wasn't consistent to continue to be part of a practice that we thought was actually counterproductive for our very goals," she said.

CARE says it will phase out the practice by 2009, and instead will look to fill the financial gap through other sources of revenue, such as private and corporate contributions.

Many charitable organizations agree with CARE's position, including Catholic Relief Services. Michael Wiest of CRS says his organization agrees monetization is inefficient, but says it will continue the practice for now.

"We don't like it either, but we think the cost to our beneficiaries is too high," he added. "In other words, the number of poor children that will no longer have assistance, because we take this position is just too high for us to accept that as sort of an approach to bring about a policy change in Washington."

But some non-governmental organizations support monetization.

The Alliance for Food is a coalition of 15 non-profit organizations with humanitarian and development programs overseas. Executive Director Ellen Levinson says members believe monetization is important in some developing countries.

"We see it in areas that have regular food shortages and must rely on imports to meet their food needs, we believe monetization adds to the food security of that country when done properly," she noted.

Bill Hammink, the director of the office of Food for Peace at the U.S. Agency for International Development (USAID), says the government strongly supports monetization and that there are mechanisms to ensure that it does not negatively impact local markets.

"Our monetized food aid does not flood local markets," he explained. "There are strict, rigorous procedures in place to limit any impact on local production in markets. In fact by law, we are required to carry out a detailed assessment of potential risks or impact on local production and markets. In some cases, we've actually changed programs as we've gone along."

But several food aid experts, including Michael Wiest of Catholic Relief Services, say monetization is not the most important issue on the food aid agenda.

"A rethink of the U.S. government food aid program in the overall is called for," he explained. "Because it is kind of dying a slow death with this slow contraction, and monetization is really a manifestation of that."

One change some aid groups advocate would be to amend U.S. law to allow them to purchase more locally produced products in recipient countries, instead of importing them from the U.S.

"That, in the long run, would build sustainable economies in those countries and be a much more efficient way of providing food for emergency situations or food for people who are in need," added Dr. Helene Gayle of CARE. "We would like to see more experiments that actually look at pilot [projects] in that direction. And that would be a way that we really could be more efficient in looking at this issue of chronic hunger."

One thing all the organizations agree on is the importance of U.S. food aid around the world. They say the program has been hugely successful over the past 50 years in saving millions of lives.